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First Move with Julia Chatterley
U.S. Futures Higher After Record-Setting Wednesday; Asian Markets Mixed Amid New Chip Production Fears; France Has Europe's Highest-Ever Rate Of New COVID Cases; W.H.O. Chief: Delta, Omicron May Bring Tsunami Of Cases; COVID Lockdown Hits Global Business In Xi'an, China; India Sees 43 Percent Increase In New COVID Cases; Political Rallies Raise Fears Of Third COVID Surge In India; Reaction To Ghislaine Maxwell's Conviction; Mourners Pay Respects To Archbishop Desmond Tutu; Hong Kong Leader Justifies Arrests Of Journalists; Fed To Watch COVID Impact, Inflations' Path In 2022; NASA To Launch Asteroid-Bound Spacecraft Next Year. Aired 9-9:30a ET
Aired December 30, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:15]
ALISON KOSIK, CNN ANCHOR: Live from New York, I'm Alison Kosik in for Julia Chatterley. This is FIRST MOVE. And here's your need to know.
High risk. The World Health Organization warns about the combined threat of Omicron and Delta.
The worst isn't over. China says the COVID outbreak is growing in a city of 13 million.
And presidential call. Biden and Putin to speak for a second time in a month.
It's Thursday. Let's make a move.
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A warm welcome to a special 30-minute edition of FIRST MOVE. Let's begin with a look at the global markets.
U.S. traders getting in gear for the second to last trading session of 2021. Futures are pointing to a modestly higher open after yesterday's
record-highs for the Dow and S&P 500. The 70th all-time high of the year for the S&P. The Dow currently on target for a seventh straight day of
gains as well amid traditionally thin holiday trading.
Meantime, green arrows in Europe. UK stocks are sitting near the 22-month highs they hit yesterday.
Asia finished the day mixed amid fresh concerns that COVID will continue to weigh on economic growth. Samsung and Micron saying this week that
lockdowns in Northwest China are impacting output. More on China's COVID response in just a moment.
But we begin with our drivers with the ongoing emergency in Europe. From London to Lisbon, we're seeing rates of COVID-19 infections rising to new
highs. France reported 208,000 new cases over 24 hours. That's the most in one day for any European country since the pandemic began. The UK also had
its worst ever day for new cases, more than 183,000. The head of the World Health Organization says things could get even worse.
(BEGIN VIDEO CLIP)
TEDROS ADHANOM GHEBREYESUS, DIRECTOR-GENERAL, WORLD HEALTH ORGANIZATIONS: Delta and Omicron are twin threats that are driving up cases to record
numbers. I'm highly concerned that Omicron being more transmissible circulating at the same time as Delta is leading to a tsunami of cases.
(END VIDEO CLIP)
KOSIK: Melissa Bell is in Paris for us. Great to see you, Melissa. You know with cases surging there and you know many countries in Europe, are
restrictions getting even tighter?
MELISSA BELL, CNN PARIS CORRESPONDENT: Yes, they are, Alison. In fact, we have been hearing here in France they've just reintroduced a mask mandate
for outdoors. So, going back a year, you had to wear a mask any time you were on the streets here in France. That is now coming back into effect.
So worried are authorities about exactly that, that dual threat that you just heard about there from the World Health Organization. Delta on one
hand, which is still driving the majority of infections here in France and already causing a strain on the health care system but Omicron which is not
far behind.
We heard from the health minister yesterday. He said, look, it is - it is - - the number of cases are doubling every two to three days of the Omicron variant, and what he explained was that although it is three times less
dangerous than other variants that we have seen, it is six to seven times more contagious. And so, what he was explaining to a parliamentary
committee that was listening to him yesterday on this matter, was that even if it tends to lead to less serious cases, nonetheless by the sheer weight
of the amount of people being infected, you mentioned that 208,000-barrier being broken yesterday. That was itself a record-breaker after the record
breaker of the day before and the one before that on Christmas day. That's how fast this is moving here in France.
The problem is that just under that sheer weight of new cases, you are going to see substantial strain on the health care system. Already
operations are being canceled and other patients being turned away here in France. Over in Germany, only a sixth of ICU beds currently available. And
that tells you how little room for maneuver they have going forward, with this fear that the sheer case load is going to lead sadly to more people
ending up in hospital, particularly of course, Alison, we keep saying this, those who have been unvaccinated.
KOSIK: Yeah. These COVID numbers are records we don't want to see broken.
Melissa Bell, thanks very much. Happy New Year if I don't see you.
In the Chinese city of Xi'an, a tight lockdown and repeated rounds of mass testing have not yet brought down the COVID case count. New infections
remain steady at around 150 a day. The shutdown is China's largest since the early days of the pandemic. And it's now hitting the world's biggest
chipmakers.
Steven Jiang reports.
[09:05:00]
(BEGIN VIDEOTAPE)
STEVEN JIANG, CNN BEIJING BUREAU CHIEF: Authorities in Xi'an are warning the worst is not over just yet for their metropolis of 13 million residents
with the city now recording well over a thousand new locally transmitted cases in the past three weeks. Officials are now also warning about the
risk of hidden transmissions and breakthrough infections justifying the need for a harsh lockdown measures as well as repeated city-wide testing.
But these sweeping containment measures are now starting to hamper the operations of two of the world's biggest chipmakers, potentially worsening
an ongoing crisis of a global chip shortage.
Both Samsung of South Korea and Micron of the U.S. have now acknowledged they had to adjust their operations in Xi'an, a major industrial hub where
both companies have invested heavily in manufacturing facilities. Now, both companies have said they would leverage their global manufacturing networks
to minimize disruptions.
And meanwhile in Southern China, disturbing videos have emerged from a border town where four people in full hazmat suits with placards join their
photos hanging around their necks being paraded through the streets for allegedly helping others illegally crossing the border into China from
neighboring Vietnam. That's considered a heinous offense apparently by local police because of China's continued border closure and increasingly
tightened COVID rules.
There have been some recent local outbreaks linked to illegal immigrants and officials there have defended their public shaming tactic saying it's
needed to act as a deterrent. But critics say this has once again exposed the dark and repressive side of China's zero COVID policy with many local
officials having little regard for human rights or dignity in the name of COVID prevention.
Steven Jiang, CNN, Beijing.
(END VIDEOTAPE)
KOSIK: For a second day in a row, India is seeing a sharp increase in new COVID cases. It reported more than 13,000 new infections today, a more than
40 percent jump over the day before. But Indian political parties are in a full campaign mode holding large rallies ahead of legislative elections in
five states early next year.
As Ivan Watson reports, there's a concern those rallies could make the COVID situation worse.
(BEGIN VIDEOTAPE)
NARENDRA MODI, INDIAN PRIME MINISTER: (speaking in foreign language)
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): India's prime minister on the campaign trail, addressing packed crowds Uttar
Pradesh, a key political battleground.
With elections due to start here early next year, Narendra Modi has made seven trips to India's most populous state in December alone.
At these rallies, most, including the nation's leader, are not wearing masks, and little mention from Modi's ruling BJP of the COVID-19 pandemic.
GILLES VERNIERS, POLITICAL ANALYST: And it seems unlikely that the BJP would want to take the risk to conduct the election in the aftermath of
another one. On the other hand, they are reckless enough to push for holding an election during a COVID wave.
WATSON: But there are fears of a repeat of recent tragic history. This was the scene in New Delhi in the spring of 2021. Crematoriums working
overtime, death tolls from COVID skyrocketing, hospital beds and oxygen in short supply.
With the health care system overwhelmed, critics accused Modi of putting politics before public health, after encouraging election rallies and large
religious gatherings, which would later be declared super spreader events by some experts.
Fast forward to today.
MODI (through translator): Omicron is a concern, please don't panic. But be careful and stay low. Use masks as much as possible.
WATSON: Some Indian states have imposed measures to curb the spread of the new Omicron variant. But despite urging caution, the national government
has yet to announce any restrictions on large public gatherings.
As cases rise, only 41 percent of India's population is fully vaccinated against COVID-19.
As the nation's political parties come out to campaign, public health officials are sounding the alarm.
V.K. PAUL, HEAD, INDIAN COVID TASK FORCE (through translator): If India observes the same pattern as the UK and if you compare the population of
both countries, 80,000 daily cases in UK would mean around 1.4 million daily COVID cases in India.
WATSON: They worry the election cycle could fuel a fresh wave of new infections.
DR. DHIREN GUPTA, SIR GANGA RAM HOSPITAL (through translator): People might not get tested if the symptoms of this variant aren't visible. So, there
are more chances of the election rallies becoming super spreader events.
But there is no doubt that we should postpone these rallies for at least two months. Prevention is the best cure for India.
[09:10:00]
WATSON: In the spring of 2021, India's health care system buckled under the pressure of its second coronavirus wave, which peaked at some 400,000
recorded daily cases.
Since then, the government has increased the number of ICU beds, and bolstered oxygen supplies. But it's still an open question how hospitals
will cope if there's a new wave of Omicron infections.
For now, Prime Minister Modi's message is clear, when it comes to casting ballots, the show must go on.
Ivan Watson, CNN -- Hong Kong.
(END VIDEOTAPE)
KOSIK: CNN has reached out to the ruling BJP and the Election Commission of India regarding the decision to allow large political events to continue
and has not received a response. India's political parties have expressed that elections should take place as scheduled with more polling booths and
more distancing while abiding by current COVID protocols states have in place. The Election Commission said today that state health officials have
told it, enough people have been vaccinated, and more are vaccinated each day. It says it will issue guidelines on rallies once formal election dates
are announced.
In the coming hours, U.S. President Biden and Russian President Putin will hold an urgent phone call at the request of Mr. Putin. The Kremlin wants to
discuss, quote, "complicated issues" amid tensions over Ukraine.
Nic Robertson joins me now from Moscow.
So, Nic, do we really know why Mr. Putin is suddenly and seemingly urgently requesting this phone meeting just weeks after speaking with President
Biden and just ahead of diplomatic talks already scheduled for January 10th?
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yeah. The Russian tone in all of this has been a writ to create a real sense of urgency both
towards with the United States, with NATO, with the SOC, and Europe. So, this is really in keeping with that.
President Biden and President Putin spoke a couple of weeks ago, and it was agreed then that they would work at a lower diplomatic level and Russia
would put forward you know it's set of issues which it did a week, 10 days or so after that phone call.
So, what we're hearing from the Kremlin is, you know now they have put forward that set of proposals, which is NATO not to expand into Ukraine,
not to take Ukraine as a member and to pull back troops close to the border, pull back NATO troops who, you know, are close to the sort of
eastern -- Europe's eastern border, if you will.
Now Russia has put that on the table. They want to have their sort of pretalks phone call between President Putin and President Biden because of
what they describe as this being, you know, as you said, "complicated issues." Extremely complicated. It's a language they're using.
What we are understanding though is that the Kremlin is still saying that it believes that it can work all of this out diplomatically. That from
their perspective, it doesn't mean that they plan to pursue a recourse to military action, that the diplomatic track is working.
We're getting more details about that diplomatic track as well. Wendy Sherman, deputy secretary of state on the U.S. side and Sergei Ryabkov, the
deputy foreign minister here, will lead those talks that will be in Geneva on the 10th of January.
But yes, Russia has really been pushing hard on this extra phone, if you will, with President Biden seems to be in that - in that vein, keep the
pressure on, keep the narrative up from the Russian perspective.
KOSIK: OK. Nic Robertson live for us in Moscow.
That call happening in a little over six hours from now. I know you'll be on it. Thanks very much.
Coming up, a step towards justice.
Survivors speak out after Ghislaine Maxwell is found guilty of recruiting young girls for abuse. Reaction to a case that's been followed around the
world.
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[09:16:00]
KOSIK: These are stories making headlines around the world.
Survivors of abuse by Ghislaine Maxwell and Jeffrey Epstein say they're relieved and grateful after Maxwell was found guilty Wednesday. The former
socialite was convicted on five out of six charges for her involvement in Epstein's sexual assault of teenage girls. One of the accusers says she
sobbed with joy when the verdict came through.
CNN's Sonia Moghe is live for us in New York.
Sonia, you have been following this trail since the beginning. Now that we have the verdicts, what's the likelihood that Ghislaine Maxwell will try to
actually cut a deal with prosecutors to try to get a lesser prison sentence in I would say, you know, if she goes ahead and maybe gives more
information?
SONIA MOGHE, CNN REPORTER: You know, Maxwell has such a savvy, aggressive legal team. We've seen this team in action for years when she's dealt with
civil lawsuits and then also after her arrest last year. So, we'll see what they end up doing, but it is guaranteed to be an aggressive -- an
aggressive move to try to get her sentence as low as possible, but she could face up to 65 years. On one of these counts alone, the sex
trafficking of a minor count, she could face up to 40 years just for that count.
So, these are very serious charges. She just turned 60 years old on Christmas day this past weekend. She could be facing potentially the rest
of her life in prison. So, her team has said, her family has said through spokespeople that they are already working on an appeal. And so, we'll see
you know sort of what next moves they make, but for victims and survivors of this abuse not only by Maxwell, but also by Epstein, they started
speaking out. We've heard from one of those women who did not testify in the trial, but who spoken publicly many times before, Virginia Roberts
Giuffre.
(BEGIN VIDEO CLIP)
VIRGINIA GIUFFRE, ACCUSED JEFFREY EPSTEIN OF SEXUAL ABUSE: We were told constantly, you know, these people will never go to jail. They're too
powerful. They're too rich. And we live in another day. And it just goes to show that, you know, this is not the end. This is just the beginning.
(END VIDEO CLIP)
MOGHE: This is not the end. This is just the beginning. Very interesting words coming from one of these accusers who has literally waited years for
this moment. There are still many other civil cases that are in the works. So, it will be very interesting to see where this case goes. Ghislaine
Maxwell herself still has two more counts of perjury in a separate case that still have to be dealt with. Alison.
KOSIK: OK. Sonia Moghe, thanks for your great reporting.
In other news, honoring a nation's moral conscience. South Africans are visiting the casket of national hero Archbishop Desmond Tutu in Cape Town.
The anti-apartheid activist is lying in state ahead of his funeral on New Year's Day. A memorial service held in Johannesburg earlier.
Hong Kong's chief executive Carrie Lam is defending the arrest of seven people connected with independent media outlet Stand News. This week, Lam
said the arrest had nothing to do with the individuals' work as journalists saying police were simply enforcing the law. Stand News has said it will
shut down on immediately raising new fears about press freedom in Hong Kong.
And you're watching FIRST MOVE. More to come after this break.
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[09:21:05]
KOSIK: Welcome back to FIRST MOVE. I'm Alison Kosik.
The opening bell is about to ring on Wall Street for the second to last time this year. And it's looking like a modestly higher open for U.S.
stocks with the S&P and the Dow on track for fresh records. The Nasdaq though is still down some 3 percent from its all-time highs.
Investors are bracing for what could be a volatile year ahead amid ongoing uncertainties over COVID, Fed rate policy, inflation, and upcoming U.S.
midterm elections.
A lot to talk about with Mark Zandi now. He joins me live. He is the chief economist at Moody's Analytics.
Great to see you.
MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYSTICS: Thanks, Alison.
KOSIK: Let's start off with the pandemic, Omicron specifically and kind of this curveball that's been thrown at the economy. It's been disrupting the
economy, you know, from travel to restaurants and more. How do you see economic growth being impacted at least at the beginning of 2022? And I'm
curious to hear about your projections for GDP?
ZANDI: Well, it's going to do damage. It already has started to do that. You can see that with the cancellation of air flights, restaurant bookings
are down. Credit card spending on travel is off, you know the National Hockey League has suspended play. So, there's a lot of anecdotes. It's too
early to see it in the government data, but I think we'll see that as we move into early next year.
And I think the Delta wave of the pandemic which hit back in the fall is a pretty good case study, Alison. It did do some damage to economic growth,
but the good news is as Delta has started to wind down, the economy started to rev back up, and I expect that to happen here with Omicron. And as we
make our way into the spring, we should see much stronger growth.
So, for in terms of GDP, you know, the first quarter of this year is going to be soft and you know I think we'll grow, but you know, very, very
slowly. But for the year, I think it should be a good year, about 4 percent growth for GDP, and that's enough to generate up jobs, to bring on
employment down even further as the year progresses.
KOSIK: Do you think with this damage that Omicron can do to consumer spending that you're talking about and just overall economic growth or
maybe even a downturn in the stock market. Do you think any of those things could push the Fed to maybe, you know, step back from its plan to raise
interest rates which is expected to happen in the first part of 2022?
ZANDI: Yeah. I think so. I think the Fed has shown a willingness to be, you know, I think the word is flexible that, you know, conditions are changing
pretty quickly here with regard to the pandemic. And of course, what's going on in Washington is also, you know, going up and down and all around
and complicating things. And so, the Fed needs to be adroit, agile and be able to change policy.
So, yeah, I think if Omicron does more damage, and Build Back Better doesn't get passed into law, you know, relatively soon, that will be a hit
to growth, then yeah, the Fed may delay when it actually begins to start raising interest rates which right now, feels like it's going to be
sometime May or June of 2022, but they could delay it.
KOSIK: The concern though is that that wouldn't clamp down on inflation. First of all, do you think it's necessary that the Fed obviously will be
flexible? Do you think that if the economy takes a hit from the pandemic from Omicron, that it should wait to raise interest rates but then the
concern is what about inflation?
ZANDI: Yeah, good point. It's a balance. It's a tradeoff. I mean it's a judgment call. I mean, if you think that the increase in inflation is going
to be temporary because, you know, it's a supply chain disruption related to the Omicron wave or labor market issues because people can't -- are
sick, can't go to work, and you know that's causing prices to rise. You know if you think that's temporary, that's not going to last, not going to
affect inflation expectations, then yeah, the Fed should be more circumspect in raising rates and be slower.
However, you know, if the inflation looks like it's going to be more persistent, it's starting to affect people's thinking about future
inflation, and inflation expectations, that means it's going to be more persistent, then no.
[09:25:03]
They probably will continue down the path they're on now and tightening the interest rates sooner rather than later. So, we're going to have to see how
this all plays out.
KOSIK: What's the biggest wild card you see for the economy in 2022?
ZANDI: Well, top of the list obviously it's the pandemic. I mean this thing is you know incredibly difficult to predict. And I think the one thing we
can predict is the future waves of the pandemic after Omicron. So, that's number one.
Number two is fiscal policy, what's going on in Washington, the Build Back Better agenda. It won't be a game changer for the economy if that doesn't
get into law, but it will have an impact. You know particularly in 2022, the child tax credit is already going to expire in January. So, that's
going to do some damage.
And the third thing I'll throw into the mix is, you know, asset prices. When I say asset prices, I mean stock prices, housing values, crypto
prices, they've gone skyward and valuations are very, very high. Speculation is starting to creep into some markets. And I think those
markets are vulnerable as the Fed does begin to raise interest rates. And that is a risk, I think, for 2022.
KOSIK: Very quickly. Yes or no? Do you think if bits of the Build Back Better plan are passed like the child tax credit, that that will help the
economy?
ZANDI: Yeah. I do indeed. I think that's critical for growth in 2022, and more importantly for longer term economic growth.
KOSIK: OK. All right, wonderful. Thank you, Mark Zandi, the chief economist at Moody's Analytics. Happy New Year as well.
ZANDI: Take care now.
KOSIK: And finally, on FIRST MOVE.
NASA has ambitious plans for the new year including a closer look at the asteroid belt between Mars and Jupiter. The Psyche spacecraft is slated to
launch in August. It will check out the Psyche asteroid which is thought to be rich in iron and nickel and has a theoretical value of, get this,
$10,000 quadrillion. That's a lot of zeros. It supposed to be the space rock could be a leftover from the early days of our solar system and could
help explain how our corner of the milky way was created. It will take the spacecraft four years to reach the asteroid.
That's it for the show. I'm Alison Kosik. Follow me on Instagram and Twitter @alisonkosik. Happy New Year.
And "THE BEST OF QUEST" is next.
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